Finding Text
U.S. Department of Housing & Urban Development Program Name: Public and Indian Housing AL Number: 14.850 Material Weakness, Procurement and Suspension and Debarment Criteria: In accordance with 2 CFR 200, management should have an adequate system of internal control procedures in place to ensure that procurement policies are implemented and functioning as intended. Management must monitor activities under federal awards to assure compliance with federal requirements. Condition: The City implemented procurement policies that conforms with applicable federal and state laws. However, the City?s internal controls over micro-purchases were not functioning as intended. Context: During our testing, we examined 40 purchases and determined that 10 purchases in the micro-purchases threshold did not follow the City?s policy. Expenditures were pre-audited prior to payment, however purchase orders were not completed as required by the City?s policy. Effect: Purchases may be made without the proper procurement approvals. Cause: Due to the turnover in the housing department, there were instances where a proper purchase order was not created for approval. Questioned Cost: None. This finding represents an internal control issue; therefore, questioned costs are not applicable. Recommendation: The City should have a system in place to ensure that the procurement policies are implemented and functioning as intended. Views of Responsible Officials and Planned Corrective Actions: The City agrees with this finding. Please refer to the Corrective Action Plan section of this report.